Real Estate Market

One thing we know for sure is that our temperatures are warming up.  Unfortunately, the forecasts for our economy and housing market are not so certain.

According to the National Association of Realtors® (NAR), on the national level, existing home sales in January fell 7.2% from December, but were still 11.5% higher than January 2009 sales.  In the Midwest, existing home sales in January fell 6.9% from December, but were still 8% above January 2009 sales.  In addition to the typical spring-time surge in home sales, sales are expected to have an added boost in the next few months as buyers take advantage of the tax credit before it expires.

Historically low interest rates continue to provide a boost to the market.  According to Freddie Mac, this week’s average for 30-year fixed-rate mortgages was 5.05 percent, up slightly from the 4.98 percent reported last month.  The average for 15-year fixed-rate mortgages was 4.4 percent, up slightly from the 4.39 percent reported last month. 

As always, borrowers with the best credit, verifiable income, and a sizeable down payment (20% or more) will get these best rates.  Buyers with excellent credit but minimal down payment (at least 3.5% for FHA) may qualify for the better rates, or close to it, but will likely have to pay mortgage insurance, increasing the cost of the loan.  Buyers with fair credit can improve their position by increasing their down payment.  If buyers with fair credit and minimal down payment are able to qualify for a mortgage, they can expect interest rate offers to be percentage points above the best rates.  All borrowers must have verification of stated income and/or assets. 

Last month we mentioned the plans to terminate the Federal Reserve’s mortgage-backed security program at the end of March.  While this is still the case, there is talk of efforts to keep interest rates low for the foreseeable future, although there has been little mentioned on exactly what these efforts will entail.

In addition to low mortgage interest rates, the national median existing-home price for all housing types was $164,700 for January, unchanged from January 2009.  Nationwide, distressed home sales (including foreclosed homes or those requiring a lender-mediated short sale, where the seller owes more than the home sells for) at discounted prices (typically 15-20% less than the normal market price), accounted for 38% of sales for January, and are still holding down average and median home prices.  Traditional (non-distressed) homes in good condition are holding their value much better.  Here in the Midwest, the median price decreased to $130,300 in January, which is 1% below January 2009.

So, what about Decatur and surrounding communities?  According to Decatur Association of Realtors® statistics, the number of REALTOR®-led home sales in January was up significantly (+65.1%) from January 2009 figures.  Average days on market was also up significantly (+41 days), while average list price (-32.2%) and average sales price (-32.8%) dropped significantly, and average sales price % of list price (-.75%) decreased slightly from January 2009.  The local median sale price for January was $55,900, down 31.4 percent from January 2009.  If is important to understand that, similar to February 2009, a large purchase of extremely low cost homes by investors skewed these numbers, although without these sales the numbers would still show huge decreases (more than 20%) in list and sale prices, and an even larger increases in average sales price % of list price (-.91%) and days on market (+60 days).

So, are we in a seller's or buyer's market here locally?  As we have been for more than a year, with few exceptions, we are still in a strong buyer’s market.  However, sellers that are either staying in the local area and moving up in home value, or leaving the local area and moving to an area with higher home prices (very likely), will find equally good deals on their new homes, and still come out ahead in the long run.

Local interest rates are very comparable to national rates.  Once again, our local lenders do have funds available to lend to qualified buyers, although the impact of credit scores and down payments mentioned earlier still applies.  These low interest rates, the availability of mortgages, and the good supply of available and affordable homes continue to make now a great time to buy.  With 653 homes on the market in our area today, there are certainly nice homes available.  For sellers, homes that are placed on the market in selling condition and conservatively priced are selling, and often selling fast. 

With everything that’s happened in the couple of years relating to real estate practices (the tightening of credit, the elimination of national seller assisted financing programs, the expired first-time-home-buyer tax credit, the new home-buyer tax credit, the creation of an Illinois down payment and closing cost assistance program, home energy efficiency tax credits, etc.), it is essential that prospective home buyers understand their options and opportunities.  Real estate professionals have the knowledge and skills necessary to help determine pricing, timing, and best value, whether you are buying or selling; whether you are a first-time buyer, or a seasoned home-buying and -selling veteran.  

With all of the confusing national real estate news that you see or hear on the TV, on the radio, on-line, or in the newspaper, it is more important than ever to examine and understand what’s happening in your local area and neighborhood.  As a home buyer or seller, you should check with a REALTOR® for local expertise on what’s going on in your specific location because conditions can vary considerably from one neighborhood to the next.  If you would like our team's assistance with the purchase or sale of a property, please give us a call. 

Who do you know that is thinking about moving and could use our services?  Our team of experts would love to help them as well.  It is our pleasure to assist you with your most precious investment.  With the Glenda Williamson team, your satisfaction is our success.

“Superior Service Isn’t Expensive, It’s Priceless!”

Community Forum Meeting Notice

You're invited to a Community Forum Meeting for Decatur's Lakefront:  A community vision. The forum will be an open house format where the community is encouraged to bring their ideas and visions for the Lakefront area. You will be able to meet the planning firm, see what other communities have successfully implemented, and talk about your ideas. This is truly an opportunity for the entire community to get involved in shaping the future of Decatur's Lakefront and Nelson Park. We want to hear from everyone so please join us on Monday, March 1, 2010, from 5-9 P.M (Open House Format), at the Scovill Golf Club.

Buyers are seeking cost-effective features and rejecting things that don’t have lasting value.  “It's all about family togetherness – casual living, entertaining and flexible spaces," says Carol Lavender, president of the Lavender Design Group in San Antonio. So what home features are buyers asking for the most in their search for a new home?

AVID Ratings Co., a firm that provides surveys and employee training to home builders across the United States and Canada, conducts an annual survey of home buyer preferences.  The company found the following hot home features reign supreme in today’s market:

1. Large kitchens with an island

2. Energy-efficient appliances and high-efficiency insulation and windows. (These were the most sought-after “green” features from buyers.)

3. Home office or study

4. Main-floor master suite

5. Outdoor living room

6. Ceiling fans

7. Master suite soaker tubs and oversize showers with seating areas

8. Stone and brick exteriors

9. Community landscaping with walking paths and playgrounds

10. Two-car garages, with three-car garages even more desirable

The Internal Revenue Service has clarified which documentation taxpayers need to submit to claim the first-time and move-up homebuyer tax credit.

While the IRS is still requiring the filing of Form 5405, it is not demanding that all parties’ signatures be on the HUD-1 settlement document in areas where requiring both the buyer and the seller to sign the document isn’t common.

The IRS clarification says: "In areas where signatures are not required on the settlement document, the IRS has clarified that it will accept a settlement statement if it is completed and valid according to local law. … The IRS encourages those buyers to sign the settlement statement prior to attaching it to the tax return.”

For repeat buyers, the IRS is seeking documentation that home buyers have lived in the previous property for a consecutive five of the past eight years. Proof can include property tax records, home owner insurance records, or mortgage interest statements.

Source: Washington Post (02/20/2010)

Words of Wisdom!

Do enjoy the following:

• "It takes two seconds to tell the truth and it costs nothing.  A lie takes time and it costs everything." -  Randi Rhodes
•  "Run when you can.  Walk when you have to.  Crawl if you must.  Just never give up." - Dean Karnazes
• "If you are never scared or embarrassed or hurt, it means you never  take chances." - Julie Soul
• "Everything is possible, if you develop a plan." - Mark Fox
• "The day on which one starts out, is not the time to start one's preparation." - African Proverb
• "If you want to turn your life around, try thankfulness.  It will change your life mightily." - Gerald Good
• "You must regulate your life by the standards you admire when you are at your best." - John M. Thomas
• "You see, it's never the environment; it's never the events of our lives, but the meaning we attach to the events - how we interpret them - that shapes who we are today and who we'll become tomorrow." - Tony Robbins
• "Everyone has got it in him, if he will only make up his mind and stick at it.  None of us is born with a stop-valve on his powers or with a set limit to his capacities.  There is no limit possible to the expansion of each one of us." - Charles Schwab
• "You don't have to be tough to survive,  you have to be vulnerable.  It's that sensitivity that makes you know how other people feel, to reach them." - Deborah Harry
• "The minute you settle for less than you deserve, you get even less than you settle for." - Maureen Down
  
  

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